Vegan food firm Beyond Meat sees sales plunge in £35m blow
A McDonald's burger with Beyond Meat patty
REUTERS
The vegan food firm specialising in plant-based meat substitutes has posted underwhelming financial results, with revenues dropping 30.5 per cent over the last three months compared to a year earlier.
Beyond Meat has seen sales plunge by almost a third and share price tumble by 12 per cent after a rocky few months of restructuring.
It comes as the company announced plans last year to cut almost a fifth of the workforce in a bid to recoup around $39million (£30.6million) in costs.
In its Q2 report published on Monday, the vegan food form cited “macroeconomic factors” for the performance downturn, including "softer demand in the plant-based meat category, high inflation, rising interest rates, and ongoing concerns about the likelihood of a recession".
Peter Andre launches the 'BBQ Beyond' campaign by Beyond Meat, aiming to demonstrate how people can create, cook and host a summer BBQ using plant-based products on May 25, 2022.
PA
Beyond Meat posted net revenues of $102.1million (£80million) for Q2, a decrease of 30.5 per cent (£35m) year-over-year.
The root cause of such a slide was a 23.9 per cent decrease in volume of products sold over the same period.
Meanwhile, shares in the company fell by almost 12 per cent in New York to $15, well below its initial public offering (IPO) price of $25 in 2019.
During an earnings call, Beyond Meat's chief executive Ethan Brown said. "This change in perception is not without encouragement from interest groups who have succeeded in seeding doubt and fear around the ingredients and process used to create our and other plant-based meats."
A pack of Beyond Meat burgers
Reuters
As a result, the company has reviewed its expected annual revenue, now predicting to take home $360million (£282million) to $380million (£298million) rather than the previously estimated $415million (£325million).
In the same three month period, Beyond Meat posted a net loss of $53.5million (£42million) which was an improvement on the $97.1million (£76million) loss last year.
In another silver lining, the company posted a gross profit of $2.3million (£1.8million) or gross margin of 2.2 per cent of net revenues, compared to a loss of $6.2 million (£4.9million), or gross margin of -4.2% of net revenues, in the year-ago period.
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Beyond Meat attributed the up tick to “lower material costs, lower inventory reserves and lower logistics costs per pound”.
Beyond Meat President and CEO Ethan Brown commented, “The second quarter brought mixed results amidst otherwise strong progress toward our goal of sustainable long-term growth.
“Ongoing category headwinds compressed net revenues, which in turn impacted product sales mix and gross margin, overshadowing significant strides in operational efficiency, including meaningful year-over-year reductions in operating expenses, COGS per pound, and overall cash consumption.”
Specialising in plant-based burgers, sausages and nuggets, Beyond Meat made its Nasdaq debut in May 2019, surging 160 per cent in first day trading to make it one of the most successful IPOs in recent memory.